SSS eyes joint ventures for P30 billion idle assets

MANILA, Philippines — State-run pension fund manager Social Security System (SSS) is looking for joint venture partners to develop P30 billion worth of prime properties in major central business districts.

SSS president and CEO Emmanuel Dooc said yesterday all major property developers in the country have approached SSS for the joint development of its prime properties in the cities of Makati, Taguig, Pasay and Quezon.

Dooc said the value of the prime properties was at least P30 billion, but may command a higher appraisal value.

These properties include a lot in Bonifacio Global City in Taguig, an old SSS building at the corner of Ayala Ave. and Rufino St. in Makati City, a five-hectare reclaimed area covering the HK Sun Plaza and a vacant lot along Diosdado Macapagal Blvd in Pasay City, and the East Triangle property at the corner of EDSA and East Ave. in Quezon City, and the parking lot near the Senate.

The pension fund manager is engaging the services of property consultancy firms.

Dooc said the SSS is looking for ways to strengthen its financial position after the first tranche of the P2,000 pension hike shortened the fund’s actuarial life to 2032 instead of 2042 as it shelled out P33 billion to P34 billion per year for the pension hike.

The second hike of P1,000, he warned, would further slash the actuarial life of SSS to 2026.

 “That is very precarious already. I did not become SSS president to bankrupt the system,” Dooc said citing the ideal actuarial life of a pension fund is 60 years.

Entering into joint ventures for the prime properties, he explained, would give the pension fund recurring income.

Latest data showed earnings of SSS slipped by 12.5 percent to P3.5 billion in the first quarter from P4 billion in the same quarter last year, while revenue inched up by 1.9 percent to P49.72 billion from P48.78 billion.

Meanwhile, Dooc said the SSS is pursuing its planned overseas foray after the $1 billion investments abroad of Government Service Insurance System (GSIS) yielded positive results.

 “Based on the experience of GSIS, they reported good returns,” he said on the sidelines of the Kapihan sa Manila Bay.

Dooc said the SSS would allocate between $200 million and $300 million for its first international foray and would tap foreign fund investment advisers.

“It is good for diversification,” he added saying it is allowed by law to invest 7.5 percent of its total investible reserve fund that currently stands at P500 billion.

  The SSS chief said the pension fund manager is going slow on its equity investments as it has only invested about P108 billion or 22 percent of its total investible funds in the stock market, below the 30 percent cap.

On the other hand, he added SSS has invested more than P200 billion in government securities.

Dooc said the pension fund manager continues to push for amendments to the SSS Charter to remove the cap especially in its investments in the equities markets both in the country and overseas.